Would you buy an investment from me that you plan to hold on to for three years if the only thing I told you about it was that it's gone up 33.3% in the last year? No -- you're a smart guy, so you'd want to know the long-term performance, and if you look at gas prices -- and I even gave you a link to the chart so you could look yourself -- you see that they were even higher than they are now in mid-2008, then they tanked (ha!) all the way down to $1.61, before rising again over the next few years:



Choosing the nadir of that wild swing as your starting point for the price of a commodity that's known to be far more volatile than others is a flat-out masterpiece of cherrypicking, but even with that cherrypicking, you're wrong. Let's look at the 36-month chart:




The price of gas on October 25, 2008 was in the $2.60 range. It's $3.46 today. That's... a 33% increase over 3 years -- or nearly the same growth rate over 3 years as over the past year -- in other words, there was no growth at all in the two years prior.

It looks like you're trying to get away with the same sleight-of-hand with the dairy prices. I don't have those handy, but simply taking the one year price increase and extending it back 2 years is just plain wrong.

This is infuriating. I know you're smarter than this, but the reality of the situation belies the point you're trying to make, so you play dumb and suggest you can simply take a one year growth rate and extend it back three years.



Everyone knows what historical inflation rates look like, and everyone knows that the Fed targets an inflation rate in the low single digits -- it's not officially written anywhere, but it's well-understood by those who plan their investment strategies. If you're putting money in a non interest-bearing account and expecting it to keep up with an inflation number that anyone can look up at any time, you're a sucker.